Many businesses only discover an energy contract exists when they receive an unexpected bill or attempt to change suppliers. In these instances, unauthorised switching may be a key issue.
What is unauthorised switching?
Unauthorised switching occurs when a broker or intermediary arranges an energy contract without obtaining clear authority from the business.
This practice is sometimes referred to as “backdoor selling” because the contract is effectively secured without proper approval from the individuals authorised to make purchasing decisions.
How does it happen?
Common situations include:
- A broker speaks to a receptionist or administrator.
- A manager is asked general questions and unknowingly provides information used to process a contract.
- A renewal is arranged without explicit consent.
- A verbal discussion is later presented as agreement to enter into a binding contract.
Businesses may remain unaware until a new supplier takes over the account.
Does a recorded sales call automatically create a valid contract?
No, not necessarily.
Several factors may be relevant, including:
- Who the broker spoke to
- Whether that person had authority to contract on behalf of the business
- What information was provided during the call
- Whether key terms were clearly explained
- Whether genuine informed consent was obtained
These are often central issues in disputes involving unauthorised switching.
Unauthorised Switching vs Commission Claims
These are two separate legal issues.
An undisclosed commission claim focuses on whether broker remuneration was transparent. Whereas unauthorised switching claim focuses on whether a valid contract was formed at all.
A business may have grounds to pursue one, both, or neither depending on the circumstances.
What should affected businesses do?
If you suspect your business was switched without authority, you should:
- Request all contract documentation.
- Ask for call recordings and sales records.
- Identify who allegedly authorised the agreement.
- Gather internal communications relating to the contract.
Looking for expert legal support? Get in touch with Business Energy Claims for a referral to our panel of experienced solicitors.